Gov. Edwards, LDH Unveil Economic Impact of Medicaid Expansion

Program’s infusion of $1.85 bill in federal funds leveraged into $3.57 billion economic activity for state

On Tuesday, Gov. John Bel Edwards and Louisiana Department of Health (LDH) Secretary Dr. Rebekah Gee touted a report from Dr. Jim Richardson of the Public Administration Institute at Louisiana State University (LSU) highlighting the economic impact of Medicaid expansion. The report, released today, shows that Medicaid expansion, the federal/state health care program that provides health coverage for individuals with income less than 138 percent of the Federal Poverty Level, is leveraging an infusion of $1.85 billion in federal funds to create or retain nearly 19,200 jobs and support nearly $3.6 billion in economic activity for the state of Louisiana.

“In Louisiana, Medicaid expansion is saving $317 million that we are able to invest in other priorities, but most importantly, it is saving lives,” said Gov. Edwards. “Improving health outcomes in Louisiana so we can have a productive workforce has been our goal, but this report further suggests that Medicaid expansion gives a big boost to our economy. For too long, the people of Louisiana were sending their tax dollars to Washington without seeing any benefits here at home. Those days are over, and this report shows us what’s possible when we make important investments like expansion in our people.”

The report, Medicaid Expansion and the Louisiana Economy, shows that:

This large federal contribution, $1.85 billion, represents an infusion of federal spending in Louisiana that would not have occurred if the state had not accepted Medicaid expansion.

This infusion of federal funds is creating or supporting 19,195 jobs across the state of Louisiana.

In addition to having a positive impact on Louisiana’s job market, Medicaid expansion is leveraging the federal funds into $3.57 billion of economic activity, which includes $3.48 billion in business activity, $103.2 million in state tax receipts, and $74.6 million in local tax receipts.

“Two years ago, when we announced Medicaid expansion, we said this would give more people access to health care coverage; we said it would save the state money; and we said expansion would boost the economy,” said Dr. Gee. “We have fulfilled all three of these promises. I am proud of this news as it demonstrates how one important policy change can have so many benefits. We will continue to build upon this work to improve both the financial health of the State and the physical health of our residents.”

“Our analysis focused on net new dollars that would not have been spent in Louisiana were it not for Medicaid Expansion,” said Dr. Richardson. “We found that new federal spending in Louisiana that would not have otherwise occurred has positively affected every region of the state. This is comparable to any other major injection of spending in the state that had not occurred in the past. This new spending is spread across all healthcare providers including hospitals, outpatient care, pharmaceuticals, physicians and other professionals, other medical services, and the administration of the program.”

Prior to expanding Medicaid, the state of Louisiana would spend approximately 40 cents on the dollar for uninsured care. However, under expansion, the state of Louisiana will never spend more than 10 cents on the dollar.